Barclays/Woolwich Tracker Mortgage Interest Problem

simon69c

My situation is slightly different although still related I think.

I am on a Woolwich tracker which also included a Mortgage Current Account, however up until now I had never really looked at it in any detail as I was simply paying my normal monthly payments by direct debit from my normal current account as I would with any other mortgage. I got given a debit card for the mortgage current account when I got the mortgage and it shows up in my online banking, but other than that I've never touched it.

Now with interest rates so low I am considering shifting a couple of credit card balances (currently on low-for-life-of-balance deals) across to the mortgage to take advantage of the crazy-low interest rate (0.73% as opposed to 6.7%). Since my mortgage allows overpayments I was planning to pay what I would have done to the credit cards (plus extra) to overpay the mortgage and bring the extra balance down more quickly than I would have been able to on the credit cards. I figure this can only be a good thing, assuming interest rates don't go back up again too much before I pay off what I transfer across. Am I missing any potential disadvantage here?

That said - I'm not entirely sure that my mortgage is currently set up to do this. When I look at my Barclays online banking I see my normal current account and then my Mortgage Current Account, with the following summary (I've changed the o/d amount to use this as an example):

Current Cleared Balance £0.00
Last Night's Balance £0.00
Overdraft Limit -£3,000.00

Reserve Amount n/a

Does that mean I have £3000 extra available to put onto the mortgage at its 0.73% rate or does it mean it is not currently linked and I need to call them up before I can shift a CC balance across?

Thanks

Trying_to_be_good

simon69c wrote: »

Does that mean I have £3000 extra available to put onto the mortgage at its 0.73% rate or does it mean it is not currently linked and I need to call them up before I can shift a CC balance across?

I don't think it's at the same low mortgage rate as the rest of the mortgage. I'm looking through my paperwork, but can't see what rate it's charged at.

Also, I don't know if it works like an offset, so any credit balance offsets against the mortgage?

Edit - just found this (http://ask.barclays.co.uk/templates/barclays/main/answerPage?_mftvst:answerRef=%24http%3a%2f%2fapi.transversal.com%2fmfapi%2fobjectref%2fEntryStore%2fEntry%2fhttp%3a%2f%2fwww.metafaq.com%2fmfapi%2fMetafaq%2fClients%2fbarclays%2fModules%2fmortgages_homes%3a140708%3a2&_mftvst:moduleID=%24mortgages_homes&_mftvst:topicID=%24&id=OUTTO9D05IHLG9R73TF937B7ES):
What’s the interest rate on my Mortgage Reserve?

All borrowing on the Mortgage Reserve is on an interest-only basis. For Offset mortgages, the interest rate for the Mortgage Reserve is the same as the rate for the main mortgage. For all other Woolwich mortgages, the Reserve interest is charged at the Woolwich Standard Variable Rate.
You can make payments to reduce the outstanding amount on your Mortgage Reserve at any time. But if no repayments are made, the interest will continue to accrue on the increasing balance.

simon69c

Ah thanks for that - not looking quite so attractive a proposition if it's at the SVR rather than my tracker rate. Anyone happen to know what the Woolwich SVR actually is at the moment? The webpage on their site that looks like it should tell me is refusing to load on my browser.

Trying_to_be_good

I think it's 4.99%, and not going down next month, but I can't get the page to load either!

getmore4less

simon69c wrote: »

Ah thanks for that - not looking quite so attractive a proposition if it's at the SVR rather than my tracker rate. Anyone happen to know what the Woolwich SVR actually is at the moment? The webpage on their site that looks like it should tell me is refusing to load on my browser.

Check to see what the costs are to change to an offset, some trackers had that option for a smallish fee and a small/no increase in rate.

With the offet the Interest rate on the resereve is at tracker not the SVR.

If it is worth it will depend on the savings against the longer term increase on the full mortgage.


On the regular tracker I don't think th ereserve offsets, it does for offsets when positive ballance(as long as it marked as offsetting )

simon69c

Oh I might look into that if that's the case. Would it be classed as an actual remortgage or would it simply be a tweak to my existing one? Spoke briefly to customer services on the phone but not sure I got through to the right department as she wanted to put me through to the remortgage team. I certainly don't want to be losing my lifetime +0.23% !

Trebor_34

Hi,
First time poster!

Took out BB Lifetime tracker +0.23% var rate in April 07
I happened to check my bank acc, but have not had any reductions. Am I right in what I have read that I need to contact the Bank and have them look at the mortgage?

chivers1977

Trebor_34 wrote: »

Hi,
First time poster!

Took out BB Lifetime tracker +0.23% var rate in April 07
I happened to check my bank acc, but have not had any reductions. Am I right in what I have read that I need to contact the Bank and have them look at the mortgage?

Just call 0800 022 4022 and they will revise your April 09 payment so long as you call before the 1st of April so call between now and Tuesday

chivers1977

simon69c wrote: »

Oh I might look into that if that's the case. Would it be classed as an actual remortgage or would it simply be a tweak to my existing one? Spoke briefly to customer services on the phone but not sure I got through to the right department as she wanted to put me through to the remortgage team. I certainly don't want to be losing my lifetime +0.23% !

If you remortgage you will lose your 0.23 Tracker so it depends on how much your main mortgage is against the further advance that you would need whether it would be worth it. the Offset tracker products are much much higher than 0.23. You have got the 4th cheapest tracker we have ever done....0.17, 0.18 and 0.19!!

The SVR is 4.99% and it will not be changing in April. So might still save you some money on your existing debts.........

getmore4less

simon69c wrote: »

Oh I might look into that if that's the case. Would it be classed as an actual remortgage or would it simply be a tweak to my existing one? Spoke briefly to customer services on the phone but not sure I got through to the right department as she wanted to put me through to the remortgage team. I certainly don't want to be losing my lifetime +0.23% !

The conversion to offset if possible would be under the existing terms modified as speced out in the T&Cs rather than current rates, you need to check your T&C's for the tracker to see if the clause is in there, I know my sister had something with their mortgage.

The other option will be to add a second loan to preserve the current deal fort he existing debt.